Inflation here we come

If the Government keeps on printing money and putting it into the economy that is the only thing that can happen. The more Obama prints the more inflation we will have to suffer. So when the Feds decide to put in $1 trillion into the economy by buying Treasury bonds where do you think that money comes from?

The Federal Reserve sharply stepped up its efforts to bolster the economy on Wednesday, announcing that it would pump an extra $1 trillion into the financial system by purchasing Treasury bonds and mortgage securities.

Having already reduced the key interest rate it controls nearly to zero, the central bank has increasingly turned to alternatives like buying securities as a way of getting more dollars into the economy, a tactic that amounts to creating vast new sums of money out of thin air. But the moves on Wednesday were its biggest yet, almost doubling all of the Fed's measures in the last year.

The action makes the Fed a buyer of long-term government bonds rather than the short-term debt that it typically buys and sells to help control the money supply.

The idea was to encourage more economic activity by lowering interest rates, including those on home loans, and to help the financial system as it struggles under the crushing weight of bad loans and poor investments.

This will have an initial positive reaction in the economy but will only lead to inflation in the end when the market starts correcting itself. We are already starting to see some of the negative effects of this too.

Oil rose to $50 a barrel for the first time since January on Thursday after a move by the Federal Reserve to buy government bonds hit the dollar and revived hopes the U.S. economy could soon begin its recovery.

The Fed announced on Wednesday it would pump another $1 trillion into the U.S. economy by buying long-term government debt for the first time since the 1960s and by expanding purchases of mortgage bonds.

"It's a combination of a drop in the U.S. dollar and the Fed's move that has pushed up oil prices," said David Moore, a commodity strategist at the Commonwealth Bank of Australia.

Add this with Obama raising taxes and we are really screwed this summer.

Us Mass residents have it even worse. Gas is going to start going up and Deval is still going to try and raise our gas tax. Although I haven't heard much news about it lately.